Entering automotive lithium-ion through majority-owned joint ventures with carmakers (2009)

The condition of holding the majority

The strangest feature of the two joint ventures was that the battery maker took the majority stake. President Yoda Makoto could say he had made majority ownership a precondition of the negotiations, it seems, because of what had happened with the consumer-battery venture formed with Mitsubishi Electric in 1997: unable to keep pace with the investment race, GS Yuasa had let the majority go five years later. The condition amounted to a refusal to be, a second time, the party that carries the capital spending while someone else sets the plan.

Control, though, did not guarantee returns. More than a decade after production began, at the briefing for the year to March 2025, the company still said it wanted a 10% operating margin but could not reach one now, placing the date somewhere in the seventh medium-term plan. Utilisation at Ritto fell to 60% in the first half of fiscal 2024, and Lithium Energy Japan, the Mitsubishi-side venture, had its business moved into the parent in 2024 and was wound up. Holding the majority solved the problem of securing a customer; it did not solve the problems of volume and utilisation.